Whether you want to make sure you have the right car insurance coverage or need to cut costs due to financial difficulties, it’s important to understand exactly what your UI and UIM coverage does. Keep reading to find out what it is and how it helps you.
What is UI and UIM Coverage?
UI stands for uninsured motorist. UIM stands for underinsured motorist. When someone drives without insurance or has limits that are too low, uninsured and underinsured motorist coverage pays for what their insurance should have.
How Many Drivers Drive Without Insurance?
In Minnesota, about 11.5% of motorists drive without insurance. That means that every time you pass nine cars, there’s a good chance that at least one of them doesn’t have insurance. This statistic doesn’t include the countless more drivers who have minimum legal policies or other low limits that wouldn’t be enough to pay for the medical bills that could come from a serious injury.
Isn’t It Illegal to Drive Without Insurance?
It is, of course, illegal for someone to drive without insurance. The problem is that the other driver getting a ticket or going to jail may make you feel better, but it won’t compensate you for your property damage, medical bills, lost wages, or other expenses you had from an accident.
You do have the option to sue the other driver, but that may not help. Most drivers who don’t have insurance or buy low limits wouldn’t be able to pay what you win in a lawsuit. You’d also have to pay your lawyer a portion of what you recovered, so you wouldn’t be reimbursed in whole. Finally, even if you are able to recover in full, the court process could take months or years, and you’d have to pay your accident expenses yourself in the meantime.
What Does UI and UIM Coverage Replace?
UI and UIM coverage is a mirror of your bodily injury and property damage coverages. Keep in mind that your bodily injury and property damage limits don’t protect you because those are liability coverages that apply to the other driver. The other driver’s coverage should be giving you protection. When you buy UI and UIM coverage, it covers you for up to your own bodily injury and property damage limits as if the uninsured or underinsured driver had that coverage.
What if You Need to Cut Costs?
If you need to cut costs, UI and UIM coverage isn’t really an extra coverage that you should eliminate entirely. You may, however, wish to talk to your insurance agent about whether your current limits may be too high for your financial needs. Other options include:
- Taking advantage of COVID-19 rebates offered by most insurance companies because fewer drivers are on the road.
- See if your insurance company is offering deferred billing or alternative payment plans.
- Increase your deductible.
- If you don’t need to drive, put your car into storage and reduce your coverage.
Talk to Your Insurance Agent
Your insurance agent can help you explore your options and make any needed changes. If you’re near Cloquet and Duluth, MN, talk to Great Lakes Insurance today.